Torben M. Andersen

Product market integration, rents and wage inequality

Publikation: Working paperForskning

Dokumenter

  • Wp10 04

    Forlagets udgivne version, 284 KB, PDF-dokument

  • Institut for Økonomi
Globalization in the form of product market integration affects labour
markets and produces winners and losers. While there are aggregate gains,
it is in general ambiguous how inequality is affected. We explore this issue
in a Ricardian model and show that it depends on the balance between
"protection" and "specialization" rents. In particular, wage inequality
among similar workers (residual wage inequality) may be U-shaped, at
first decreasing and then increasing in the process of product market integration.
Consequently, there may be gains in both the efficiency and
the equity dimension until integration reaches a certain level at which a
trade-off arises.
OriginalsprogEngelsk
UdgivelsesstedAarhus
UdgiverInstitut for Økonomi, Aarhus Universitet
Antal sider25
StatusUdgivet - 2010

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